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Cincinnati Financial makes its case at conference

  • Cincinnati Financial (CINF +0.3%) is slightly ahead of pace in its goal of hitting $5B in premium volume by the end of 2015, says CEO Steve Johnston, presenting at the KBW conference (transcript) (presentation slides).
  • Talking about the investment side of the business, CFO MIke Sewell notes CINF is somewhat more aggressive than competitors, with 31% of the portfolio in stocks vs. an 18% industry average. The resultant yield on invested assets for Cincinnati in 2012 was 4.39% vs. 4.02% for the industry. While this has declined 36 bps to 4.03% for CINF this year, it has fallen 54 bps for the industry to 3.48%.
  • Rising interest rates took no bite out of book value as a 3.6% decline in book from lower bond prices was offset by a 5.6% increase from the stock portfolio.
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